Choice Hotels to compete with Airbnb for vacation rentals
Choice Hotels, parent company of Comfort Inn and Cambria Suites, has entered the vacation rental business.
The company will partner with independent vacation rental management companies at various destinations to offer travelers an alternative to traditional hotel rooms.
Choice CEO Stephen Joyce says there’s an increased demand from consumers who want longer-term stays and larger accommodations with amenities they can enjoy at home.
The move pits Choice, one of the largest hotel companies in the world, in direct competition with Airbnb and other peer-to-peer vacation rental websites.
“It’s a huge business. It’s $24 to $28 billion,” Joyce says. “We don’t have to get much of a share to do really well.”
Vacation Rentals by Choice Hotels will be integrated with the Choice Privileges rewards program. Joyce says the management companies will be carefully vetted before being invited to join Choice.
“We’re getting a lot of interest from vacation rental management companies,” he says. “We’re going to pick the best ones that do the best job serving customers who will eventually be our customers.”
Choice will also offer customer reviews, detailed descriptions, and images of each property.
Study: Airbnb poses threat to hotel industry
The management companies will benefit from being able to use Choice’s reservations system, training and business services.
The hotel industry has been pushing for greater government regulation of Airbnb and other such companies. They argue that peer-to-peer lodging companies should also have to pay taxes and comply with healthy and safety standards.
“We think we can provide something Airbnb doesn’t have and that is assurances you will be dealt with professionally by a professional company that does that for a living,” Joyce says. “If there’s a problem, it gets fixed. If something is not the way it should be, that will get changed, and there’s someone to call when there’s a problem. We think that’s going to make a huge difference.”
Wyndham Worldwide has had a vacation rental segment since 2001. Wyndham Vacation Rentals now has more than 108,000 rental properties in almost 600 destinations.
Hyatt Hotels offers vacation ownership services with Hyatt Residence Club, a points-based membership exchange system. Residence Club members are entitled to all the privileges of membership in the Hyatt Gold Passport frequent guest program.
At least one hotel CEO believes the Airbnb threat is overstated.
"It’s quite a small piece of the puzzle but it makes a lot noise obviously,' InterContinental Hotels Group CEO Richard Solomons told USA TODAY Tuesday morning after announcing positive fourth quarter earnings.
Solomons acknowledges that there are some travelers who want to feel like they are staying in a home rather than a hotel. But he says IHG is already appealing to those customers through extended stay brands like Staybridge Suites and Holiday Inn Club Vacations.
"At the moment, we are meeting those guests' needs through a lot of other options," he says.
Choice is launching its new program at eight U.S. locations, including Orlando, Aspen, Phoenix and Big Bear Lake, Calif. The management companies it is partnering with include Magical Memories and Sterling Resorts.